Method and apparatus for providing open-ended subscriptions to commodity items normally available only through term-based subscriptions

ABSTRACT

A system for providing an open-ended subscription to commodity items normally available on a term basis includes a central agent that serves as the front-end for commodity suppliers. This central agent maintains databases containing information associated with a group of commodity items and their sales. Using these databases, the central agent produces subscription records to provide open-ended subscription services to its customers, while supporting the term-based subscriptions of the commodity suppliers.

BACKGROUND OF THE INVENTION

[0001] 1. Field of the Invention

[0002] The present invention relates generally to subscription services.More particularly, the invention relates to a method and apparatus forproviding open-ended availability to commodity items, such as magazines,normally available to consumers only through renewable term-basedsubscriptions.

[0003] 2. Description of the Related Art

[0004] Most periodicals, such as newspapers and magazines, are availableto consumers through subscriptions. Such subscriptions allow consumersto receive delivery of the periodicals at home. Subscriptions availablefor newspapers, however, differ from subscriptions available formagazines in at least one respect. Newspaper subscriptions are typicallyavailable on a continuous, or open-ended basis, where the subscriptionsdo not expire simply because a period of time, or term, has elapsed.Rather, newspaper subscriptions terminate only after subscribers contactthe newspaper publisher and cancel the subscriptions. In the context ofsubscriptions, the term “open-ended” refers to subscriptions ofindefinite duration, subject only to the subscriptions being canceled.

[0005] By contrast, magazine subscriptions involve consumers contractingwith magazine publishers to pay for and receive magazines for fixedperiods of time, or terms (i.e., 1 year). These magazine subscriptionsexpire only after their respective terms have elapsed. Until then,subscribers are committed to receive the magazines for the entire lengthof the subscription term. Some consumers may never subscribe tomagazines simply because they are unwilling to commit themselves tobuying magazines that they may not want to receive in the future.

[0006] If magazine subscribers want to continue to receive magazineswithout disruption, they must renew their subscriptions before theyexpire. The process of renewing subscriptions traditionally involves twobasic stages. First, magazine publishers phone or mail renewal noticesto subscribers as subscriptions approach the end of their terms. Mailedrenewal notices often comprise letters requesting subscribers tocontract to purchase magazines for another term. Subscribers who desireto renew must provide renewal instructions by, for example, filling outthe renewal notice form and mailing it back to the magazine publisher.Subscribers may choose to pay the renewal cost at the time of renewal.If not, magazine publishers send invoices to the subscribers returningrenewal instructions. The subscribers receiving the invoices must writeout checks for the invoice and send them back to the publishers tocomplete the renewal process. Alternatively, credit card accounts may beused to pay for renewals.

[0007] Such a renewal process, however, inherently discouragessubscribers from renewing their subscriptions. Under this process, allsubscribers desiring continued receipt of a magazine title receiverenewal notices and provide renewal instructions near the end of everysubscription term (e.g., every year). This not only presents needlessinconvenience to those subscribers, but also forces subscribers toperiodically reconsider and reevaluate whether the value imparted by thesubscriptions justify their expense.

[0008] In addition, publishers usually mail out multiple renewalnotices, sometimes up to fifteen, to their subscribers. In some cases,supplemental renewal notices from publishers may cross in the mail withrenewal instructions from subscribers. Subscribers receiving thesesupplemental renewal notices may be uncertain as to whether thepublishers received their renewal instructions or whether thesubscribers even submitted the instructions. As a result, somesubscribers may inadvertently return two (or more) sets of renewalinstructions. Also, inadvertent failure to return renewal instructionsin a timely fashion may result in sudden, and in some cases unnoticed,disruptions in subscription services. Thus, the traditional renewalprocess is fraught with problems.

[0009] Attempts have been made to address the shortcomings of thetraditional renewal process. One attempt involved requiring subscribersto agree o automatic renewal of their subscriptions, unless theynotified the publishers otherwise. Under this automatic renewal process,publishers sent invoices near the end of subscription terms without eversending renewal notices. Subscribers desiring to terminate theirsubscriptions returned their invoices with the word “canceled” writtenon them without enclosing payment. Publishers receiving such invoicesprocessed those subscriptions as canceled. Those subscribers who desiredto continue subscription services returned the invoice along withpayment for the subscriptions. One magazine publisher, the AmericanExpress Publishing Company (AEPC) implemented an automatic subscriptionrenewal system. AEPC required that, in subscribing to its magazines,subscribers must not only agree to automatic 1-year subscriptionrenewals, but also agree to charge payment for the renewals on thesubscribers' American Express card.

[0010] Such automatic renewal systems suffered their own drawbacks.Publishers adopting automatic subscription renewal systems usuallyimposed automatic renewal as a nonoptional condition to magazinesubscriptions. Subscribers often did not even realize that they had toaffirmatively cancel their subscriptions to avoid renewal. This wasconfusing to unwitting subscribers wishing to discontinue receipt ofmagazines once their subscription terms had ended.

[0011] Automatic renewal systems suffered yet other problems andlimitations, including the limitation that only very limited selectionsof magazines could be sold on such a basis. Since automatic renewal waspracticed by a publisher, choices were limited to those titles availablefrom the publisher. Further, the nature of the transaction oftenrequired the buyer to commit to undetermined, future price increases tobe determine unilaterally by the publisher.

[0012] Yet other systems required buyers to prepay for multi-yearsubscriptions. As with the automatic renewal systems noted above, suchpre-paid systems provided the buyers little flexibility in payment andcancellation options, and small selections of magazines.

[0013] Thus, both traditional and automatic subscription renewal systemsgive rise to unsatisfactory shortcomings and complications thatdiscourage consumers from wanting to subscribe to magazines.

SUMMARY OF INVENTION

[0014] Accordingly, the present invention is directed to a method andapparatus that substantially obviates one or more of the problems due tolimitations, shortcomings, and disadvantages of the related art.

[0015] One advantage of the invention is that consumers are empowered toobtain open-ended subscriptions to commodity items, such as magazines,normally only available to consumers through renewable term-basedsubscriptions.

[0016] Another advantage is that subscription renewal notices, andassociated billings, are eliminated without requiring automatic renewalof a term-based subscription.

[0017] Yet another advantage is that the inherent risk that magazinesubscriptions will be disrupted because the magazine publisher did notreceive renewal instructions or payment is avoided.

[0018] Still another advantage is that subscribers can have theflexibility to cancel subscriptions at any time, and not only when asubscription term has elapsed.

[0019] A further advantage is that a wide selection of magazines can beprovided under a continuous service program.

[0020] To achieve these and other advantages, one aspect of theinvention includes a system for managing subscriptions to commodityitems, comprising a device for receiving customer orders for open-endedsubscriptions to the commodity items, a device for storing the receivedcustomer orders, a device for generating supplier orders for renewableterm subscriptions to the commodity items based upon the stored customerorders, and a device for transmitting the supplier orders to respectivesuppliers of the commodity items.

[0021] In another aspect, the invention includes a system for providingopen-ended subscriptions to commodity items, comprising a first databasestoring customer orders for open-ended subscriptions to the commodityitems, a second database storing information relating to renewable termsubscriptions through which the commodity items are available fromrespective suppliers; and a device for correlating the customers ordersin the first database with information stored in the second database andfor generating supplier orders for renewable term subscriptions to thecommodity items based upon the correlation.

[0022] Additional aspects of the invention are disclosed and defined bythe appended claims. It is to be understood that both the foregoinggeneral description and the following detailed description are exemplaryand explanatory and are intended to provide further explanation of theinvention as claimed.

BRIEF DESCRIPTION OF THE DRAWINGS

[0023] The accompanying drawings illustrate a preferred embodiment ofthe invention. The drawings are incorporated in and constitute a part ofthis specification.

[0024] In the drawings:

[0025]FIG. 1 illustrates a preferred embodiment of a system, accordingto the invention;

[0026]FIG. 2 illustrates a preferred embodiment of the central agentused in the system shown in FIG. 1;

[0027]FIG. 3 illustrates a sample of the contents of the order databasestored in the central agent shown in FIG. 2;

[0028]FIG. 4 illustrates a sample of the contents of the magazinedatabase stored in the central agent shown in FIG. 2;

[0029]FIG. 5 illustrates a sample of the contents of the publisherdatabase stored in the central agent shown in FIG. 2;

[0030]FIG. 6 illustrates a database conversion process executed by thesystem shown in FIG. 1;

[0031]FIG. 7 illustrates an order process executed by the system shownin FIG. 1;

[0032]FIG. 8 illustrates a conversion process executed by the systemshown in FIG. 1;

[0033]FIG. 9 illustrates a subscription process executed by the systemshown in FIG. 1;

[0034] FIGS. 10A-10B illustrate a continuous billing process executed bythe system shown in FIG. 1; and

[0035] FIGS. 11A-11B illustrate a continuous billing process executed bythe system shown in FIG. 1.

DETAILED DESCRIPTION

[0036] Introduction

[0037] The system of the invention avoids the shortcomings of prior artrenewal systems by offering magazine subscriptions on an open-endedbasis, thereby eliminating any need for renewals. The system interfacesmagazine publishers with magazine subscribers, and takes into accountthe fact that magazine publishers, in practice, normally only offermagazine subscriptions to subscribers on a term (fixed period of time)basis. The system also integrates magazine publishers and magazinesubscribers with a payment clearinghouse to simplify subscriptionpayments. While the system is described in connection with magazinesubscriptions, it applies to any commodity item that is normallyavailable to consumers only through renewable term-based subscriptions.

[0038] The system of the invention includes a central agent that servesas the front-end for commodity suppliers. This central agent maintainsdatabases and produces subscription records to provide open-endedsubscription services to its customers, while supporting the term-basedsubscriptions of the commodity suppliers.

[0039] System of the Invention

[0040]FIG. 1 shows one embodiment of the system according to theinvention. In this embodiment, the system includes central agent 110configured to receive data from customers 120 (magazine subscribers),transmit data to commodity suppliers 130 (magazine publishers), andauthenticate customer credit card data through payment clearinghouse140.

[0041] Agent 110 preferably comprises a processor-based system thatmaintains databases of information relating to magazine subscriptions.Agent 110 interfaces customers 120 with suppliers 130 to provideopen-ended magazine subscriptions to customers 120. Agent 110 correlatesinformation stored in these databases to effect the purchase ofsubscription items from suppliers 130 in accordance with subscriptioninformation stored in one of the databases and to effect the sale of thesubscription items to customers 120 in accordance with sales informationstored in another database. The structure of one embodiment of agent 110is described below in connection with FIG. 2.

[0042] Customers 120 include parties, such as individuals or companies,wishing to subscribe to magazines on an open-ended basis. Customers 120order magazines through agent 110 by transmitting subscription ordersspecifying what magazines they wish to subscribe to. Customers 120 cantransmit these subscription orders through various ways. In a preferredembodiment, customers 120 fill out paper forms specifying whichmagazines they wish to subscribe to and mail them to agent 110.Operators at agent 110 type or scan the subscription orders into dataterminals. Two alternative ways for customers 120 to transmitsubscription orders to agent 110 include customers 120 telephoningoperators at agent 110 to verbally specify their subscription interestsand customers 120 transmitting subscription orders electronically from acustomer's data terminal to an operator's data terminal connected, forexample, through a public switched telephone network or the Internet. Asdescribed in greater detail below, customers 120 sign up for open-endedmagazine subscriptions through agent 120 and can cancel thesubscriptions by notifying agent 110.

[0043] Commodity suppliers 130 (magazine publishers) provide commodityitems, such as magazines, through term-based subscriptions. Suppliers130 receive subscription records and payment based upon the agent ratefrom agent 110 and, based upon the received subscription records,deliver commodities (magazines) to customers 120 (magazine subscribers)as they otherwise would for term-based subscriptions. In a preferredembodiment, agent 110 transmits subscription and cancellation records tosuppliers 130 through a public switched phone network. Thesesubscription records preferably contain a unique code that causessuppliers 130 to suppress issuance of renewal notices so that customers120 do not receive any renewal notices while the open-ended subscriptionremains active.

[0044] Payment clearinghouse 140 receives and validates customer paymentfor magazines. Clearinghouse 140 preferably comprises a credit cardclearinghouse capable of verifying credit card status, and appropriatelycharging and refunding amounts to credit cards. Clearinghouse 140receives the credit card information from agent 110 and transmits itsresponse through secure transmission lines. In an alternativeembodiment, clearinghouse 140 could authenticate charges and refunds forbank accounts. Data communicated between agent 110 and clearinghouse 140is preferably encrypted using conventional encryption techniques toensure that third parties cannot misappropriate any transmittedfinancial or credit card information.

[0045]FIG. 2 illustrates one embodiment of agent 110 used in the systemshown in FIG. 1. As shown in FIG. 2, agent 110 includes centralprocessing unit (CPU) 210, random access memory (RAM) 220, read-onlymemory (ROM) 230, at least one data input device 240, large capacitystorage device 250, and network interface 260. CPU 210, preferablycomprising a conventional microprocessor such as an Intel® Pentium®processor, is electronically coupled to each of agent 110's otherelements.

[0046] CPU 210 executes program code (not shown) stored in one or moreof RAM 220, ROM 230, and storage device 250 to carry out the functionsand acts described in connection with agent 110. CPU 210 preferablycomprises at least one high-speed digital data processor adequate toexecute program modules for magazine ordering, subscriptions, continuousbilling, and magazine order cancellation. These modules are described inconnection with FIGS. 7-10B. CPU 210 interacts with RAM 220, ROM 230,and storage device 250 to execute stored program code according toconventional data processing techniques.

[0047] Data input device 240 permits operators at agent 110 to enterorder data from customers 120. Device 240 preferably comprises digitaldata processing terminals configured to input order data that operatorsmanually enter through, for example, a keyboard or mouse. Operators mayobtain this data from paper forms filled out by customers 120 or fromtalking to the customers 120 via telephone. Alternatively, device 240could also be configured to electronically scan forms filled out bycustomers 120. Device 240 transmits the entered data to CPU 210 forstorage in storage device 250. In an alternative embodiment, data inputdevice 240 could receive electronic transmissions representing orderdata from customers 120, in which case device 240 would be coupled tonetwork interface 260. Although FIG. 2 shows agent 110 as containingonly a single data input device 240, agent 110 could contain acombination of one or more data input devices of the different typesdescribed above.

[0048] Large capacity storage device 250 contains transaction processor252, order database 254, magazine database 256, and publisher database258. Transaction processor 252 maintains, calculates, and accesses datastored in the databases and generates publisher subscription andcancellation records, as described in connection with FIGS. 6-11B.Transaction processor 252 preferably encrypts financial or credit carddata before transmission according to conventional encryptiontechniques. Transition processor 252 may comprise a separate,conventional CPU/microprocessor, or a portion of the operating functionof CPU 210. Order database 254 contains data about customers 120 andwhich magazines they desire to subscribe to. Magazine database 256contains information about each magazine, including its publisher, cost,and distribution frequency. Publisher database 258 contains informationrelating to magazine publishers, including which magazines eachpublishes and the data formats used to generate subscription andcancellation orders. Samples of the records and their respective fieldscontained in databases 252, 254, and 256 are shown in and described inconnection with FIGS. 3-5. A representation of a database conversion forgenerating subscription records used by suppliers 130 is shown in FIG.6.

[0049] Network interface 260 comprises a device for allowing agent 110to communicate with other data terminals connected to the publicswitched phone network. Interface 260 preferably comprises aconventional high-speed modem employing known communication protocolscapable of decrypting encrypted data received from the public switchedphone network.

[0050] Database Formats

[0051] Samples of the contents of databases 254, 256, and 258 are shownin FIGS. 3-5. The specific data and fields illustrated in these figuresrepresent only one embodiment of the records stored in the databases ofthe invention. In most cases, the fields shown in FIGS. 3-5 arerelatively straight forward and self-explanatory. It is understood thatthe data and fields of these databases, as well as the number ofdatabases, can be readily modified from the described embodiment andadapted to provide open-ended availability to commodity items, such asmagazines, normally available to consumers only through renewableterm-based subscriptions without undue experimentation.

[0052] Order database 254 essentially maintains a log of the magazinesordered by customers 120 and the payment method. FIG. 3 illustrates asample of the contents of order database 254. As shown in FIG. 3, orderdatabase 254 contains order records having fields corresponding to, forexample, order ID, customer information, date of order, credit cardinformation, payment frequency, next payment date, magazine ID ordered,publisher term expiration date, status: active or canceled, and saleterms. The fields whose data is extracted directly from customer ordersinclude customer information, date of order, credit card information,magazine ID ordered, and status. “Payment frequency” represents theduration between customer payments to agent 110 and is typicallypreselected by agent 110 or, in alternative embodiments, may be selectedby the customer when completing the customer order. From this data anddata stored in other databases, the data for the remaining fields can becalculated.

[0053] Magazine database 256 contains information about the magazinesthat are available through agent 110 on an open-ended basis. FIG. 4illustrates a sample of the contents of magazine database 256. As shownin FIG. 4, database 256 contains magazine records having fieldscorresponding to, for example, magazine ID, magazine name, publisher ID,publisher term information, consumer rate for term, agent rate for term,and magazine distribution frequency. This information is provided andperiodically updated by magazine publishers who have agreed to utilizeagent 110 as their marketing and sales partner.

[0054] Publisher database 258 contains information about the magazinepublishers. FIG. 5 illustrates a sample of the contents of publisherdatabase 258. As shown in FIG. 5, publisher database 258 containspublisher records having fields corresponding to, for example, publisherID, publisher name, publisher information, publisher subscription dataformat, list of magazine IDs published, and publisher cancellation dataformat. Publishers subscription data format and publisher cancellationdata format are files describing the internal data formats thatrespective publishers use to process subscriptions and cancellations.Using these formats, agent 110 can transmit subscription andcancellation orders in the same unique format used internally bysuppliers 130 themselves, thereby minimizing incompatibility problems.Like the data in magazine database 256, data in publisher database 258is also provided and periodically updated by magazine publishers.

[0055] The use of data from order database 254 and magazine database 256to generate publisher subscription records according to the publisher'sunique format is represented in FIG. 6. Agent 110 uses order database254 and magazine database 256 to generate publisher subscription recordsin accordance with the formats stored in publisher database 258. Agent110 transmits these subscription records to respective suppliers 130 fortheir use. Agent 110 also generates publisher cancellation records in asimilar manner to cancel subscriptions from suppliers 130.

[0056] Process

[0057] In providing open-ended availability to magazines normallyavailable to consumers only through renewable term-based subscriptions,the system shown and described in connection with FIGS. 1 and 2preferably executes several distinct modules, or processes. Theseprocesses include an ordering process, a conversion process, asubscription process, a continuous billing process, and a cancellationprocess. The steps associated with these processes are described inconnection with FIGS. 7-11B and can be performed in any order, unlessotherwise specified or dictated by the steps themselves. In alternativeembodiments, these processes can be modified from what is described andadapted to provide open-ended availability to commodity items, such asmagazines, normally available only through renewable term-basedsubscriptions.

[0058] The ordering process involves a series of steps through which thesystem establishes data stored in order database 254. As shown in FIG.7, operators at agent 110 receive subscription orders for magazinesubscriptions from customers 120 (step 710). Agent 110 creates orderrecords from the subscription orders for storage in order database 254(step 710). The received subscription orders may comprise preprintedorder forms from which customers 120 select or indicate which magazinesthey want to subscribe to on an open-ended basis. The forms contain theconsumer rate at which respective magazines are available. Agent 130agrees to notify customers 120 as soon as any changes to the customerrate occur. The data in these subscription orders includes magazineidentification (ID) for each magazine to which customers 120 desire tosubscribe and payment information, such as credit card number andexpiration date. Using the magazine IDs contained in the subscriptionorders, agent 120 retrieves corresponding magazine information frommagazine database 256 (step 720). This magazine information preferablyincludes publisher term information and consumer rate for term. Agent110 calculates data for two of the remaining fields of order database254, and the “first payment amount” field, as follows:

“next payment date”=payment frequency+date of order (step 730);

[0059] $\begin{matrix}{{\begin{matrix}{{''}{first}\quad {payment}} \\{{amount}{''}}\end{matrix} = \frac{{payment}\quad {frequency}*{consumer}\quad {rate}}{{publisher}\quad {term}}};} & \left( {{step}\quad 740} \right) \\{\begin{matrix}{{''}{publisher}\quad {term}} \\{{expiration}\quad {{date}{''}}}\end{matrix} = {{{publisher}\quad {term}} + {{date}\quad {of}\quad {{order}.}}}} & \left( {{step}\quad 750} \right)\end{matrix}$

[0060] By way of example, where the publisher term is twelve (12) monthsand the agent rate is $18 per year, and where the date of order is Jan.1, 1997, payment frequency is quarterly (i.e. once every three (3)months), and consumer rate is $36 per year, the above fields can becalculated as follows:

“next payment date”=Jan. 1, 1997+three (3) months=Apr. 1, 1997

“first payment amount”=3*$36/12=$9

“publisher term expiration date”=twelve (12) months+Jan. 1, 1997=Dec.31, 1997

[0061] Preferably, the system rounds off each month to constitute one‘unit’ for purposes of calculations based on dates.

[0062] Data for the remaining fields represent either predetermined orconstant information (e.g., payment frequency, status, sale terms) orinformation determined upon processing of the subscription order (e.g.,order ID, date of order).

[0063] Agent 110 transmits the credit card number, expiration date, andfirst payment amount to clearinghouse 140 for authorization (step 760).Agent 110 receives authorization from clearinghouse 140 that the firstpayment amount was charged to the credit card (step 770).

[0064]FIG. 8 illustrates a conversion process of the invention. Inaccordance with this conversion process, the system of the inventionallows consumers to “convert” their term-based subscriptions intoopen-ended subscriptions. The system utilizes information related to theparticular term-based subscription to retrieve information needed toperform the conversion. As shown in FIG. 8, the system receivesinformation on the customer's term-based subscription (step 810). Thisinformation preferably includes the magazine title, customerinformation, and term expiration date. In one embodiment, the systemreceives the information from customer 120. Alternatively, the systemmay receive the information from supplier 130. The system uses thisreceived information to retrieve related magazine from database 256 andpublisher information from database 258 (step 810) and creates an orderrecord (step 820). The system stores the order record in order database254 (step 820).

[0065] The system creates a magazine subscription record and transmitsthe record to supplier 130 (magazine publisher) (step 830). This step issimilar to steps 1055 and 1060 described in connection with FIG. 10Bbelow. This magazine subscription record preferably instructs supplier130 that agent 110 will assume continued payment of the subscription.This magazine subscription record also instructs supplier 130 to eithersuppress mailing of renewal notices or mail such notices to agent 110.Further, the magazine subscription record preferably includes thecustomer's name and address as recipient of the magazine so that thecustomer receives uninterrupted delivery of the magazine.

[0066] The subscription process involves a series of steps through whichthe system processes order records to generate publisher subscriptionrecords, which are transmitted to commodity suppliers 130 for their usein delivering magazines. As illustrated in FIG. 9, agent 110 extractsthe magazine ID number from an order record and retrieves magazineinformation from magazine database 256 corresponding to that magazine IDnumber (step 910). Agent 110 extracts the publisher ID number from theextracted magazine information to retrieve publisher information frompublisher database 258 (step 920). Agent 110 creates magazinesubscription records in publisher subscription data format, as stored indatabase 258, and using order records stored in order database 254 andmagazine records stored in magazine database 256 (step 930). This stepis described in greater detail above in connection with FIG. 6. Agent110 transmits the subscription records to supplier 130 (magazinepublisher), along with agent rate payment for the subscription term(step 940). In this way, agent 110 pays supplier 130 for delivery ofmagazines for a full term based upon the less expensive agent rate, andreceives payments from customers 120 once every payment frequency basedupon the more expensive consumer rate.

[0067] The billing process involves a series of steps through which thesystem determines whether any payment from customers is due and, if so,charges those payment amounts to customer credit cards. As shown in FIG.10A, agent 110 searches order database 254 to identify any order recordswhose “next payment date” field contains a date less than (e.g., earlierthan) today's date and whose status is not canceled (e.g., active) (step1010). Agent 110 retrieves the identified order records and magazinerecords corresponding to the magazine IDs found in the identified orderrecords (step 1015). Agent 110 recalculates several fields for theidentified order records, including “next payment date,” which is thesum of payment frequency and the previous date stored under the “nextpayment date” field (step 1020), and “payment amount,” which is thepayment frequency divided by the publisher term and multiplied by theconsumer rate (step 1025). Following the example described above, therecalculations could be done as follows:

[0068] Where the recalculation is done on Apr. 2, 1997:

“next payment date”=three (3) months+Apr. 1, 1997=Jul. 1, 1997

“payment amount”=3*$36/12=$9

[0069] Agent 110 transmits credit card number, expiration date, andpayment amount to clearinghouse 140 (step 1030) and receivesauthorization of the charge from clearinghouse 140 (step 1035). In thismanner, the amount due is billed to the consumer in the next normalbilling cycle of the customer's credit card.

[0070] Agent 110 also determines whether the term for any paidsubscriptions has expired and, if so, issues appropriate renewalinstructions to the publisher. As illustrated in FIG. 10B, agent 110determines whether the publisher term expiration date for each orderrecord is less than (e.g., earlier than) today's date (step 1040). If nopublisher term expiration dates are less than today's date, then nosubscriptions need renewal (step 1045). If at least one publisher termexpiration date is less than today's date, then agent 110 determinesthat those subscriptions need renewal and retrieves from publisherdatabase 258 publisher information corresponding to the publisher ID ofeach subscription requiring renewal (step 1050). Agent 110 creates a newmagazine subscription record using the appropriate publishersubscription data format and using appropriate magazine and orderrecords (step 1055). Agent 110 transmits the new magazine subscriptionrecord, along with payment based upon the agent rate, to the appropriatesupplier 130 (step 1060).

[0071] The cancellation process involves updating order records toreflect cancellation orders from customers 120. Since customersubscriptions are provided on an open-ended basis, customers can notifyagent 110 at any time that they would like their subscriptions canceled.With reference to FIG. 11A, upon receiving cancellation orders, agent110 searches order database 254 for customer information matching thatof the customer who canceled his subscription (step 1110). Agent 110retrieves the order record (step 1115) and changes the order recordstatus to “canceled” (step 1120). Agent 110 uses the magazine ID in theretrieved order record to retrieve the magazine record corresponding tothe canceled subscription(step 1125) and calculates the refund amountthat agent 110 owes the customer for prepaid, but undelivered magazineissues (step 1130). This refund amount is calculated based uponinformation stored in account records and magazine records, includingsales terms, next payment date, today's date, payment frequency, andcustomer rate. If the sales terms provide for full refunds to customers120, agent 110 calculates the refund amount as follows: $\begin{matrix}{{refund}\quad {amount}} \\{{to}\quad {customer}}\end{matrix} = \frac{\begin{matrix}{\left( {{{next}\quad {payment}\quad {date}} - {{{today}'}s\quad {date}}} \right)*} \\{{customer}\quad {payment}\quad {amt}}\end{matrix}}{{payment}\quad {frequency}}$

[0072] Agent 110 transmits the credit card number, expiration date, andrefund amount to clearinghouse 140 (step 1135) and receivesauthorization and confirmation from clearinghouse 140 that the creditcard was credited (step 1140).

[0073] In addition to modifying its own records and issuing refunds tocustomers 120, as illustrated in FIG. 11B, agent 110 generatescancellation records for suppliers 130 and calculates the refundsuppliers 130 owe to agent 110 (step 1145). The refund amount fromsupplier 130 to agent 110 is calculated as follows: $\begin{matrix}{{refund}\quad {amount}} \\{{to}\quad {agent}}\end{matrix} = {\frac{\begin{matrix}\left( {{{publisher}\quad {term}\quad {expiration}\quad {date}} -} \right. \\\left. {{{today}'}s\quad {date}} \right)\end{matrix}}{{publisher}\quad {term}}*\quad {agent}\quad {rate}}$

[0074] Continuing the example described above, the cancellation refundsare calculated as follows:

[0075] Where the cancellation occurs on Aug. 1, 1997:

“refund amount to customer”=(Oct. 1, 1997−Aug. 1, 1997)*$9/3=2*$9/3=$6

“refund amount to agent”=(Dec. 31, 1997−Aug. 1,1997)*$18/12=5*$18/12=$7.50

[0076] Thus it will be appreciated that, since the customer is payingquarterly on an open-ended basis, and has canceled one-third of the waythrough a quarter, he receives a refund of two-thirds of his quarterlypayment. Since the agent has pre-paid the entire term to the publisher,and has received the benefit of seven months of the 12 monthsubscription term, he receives a refund for the balance of the year, orfive-twelfths of his agent's cost.

[0077] Agent 110 uses publisher IDs from magazine records of thecanceled subscriptions to retrieve publisher cancellation data format(step 1150). Agent 110 creates a cancellation record using the publishercancellation data format and using order and magazine recordscorresponding to the canceled subscription (step 1155) and transmits tosupplier 130 the cancellation record and a request for the calculatedrefund amount owed to agent 110 (step 1160). Agent 110 receives therefunded amount from supplier 130 (step 1165).

[0078] Special Service Features

[0079] It will be appreciated that the system and method of the presentinvention permits many special services to be provided to customer 120by the agent. For example, the system of the invention can provide theability to synchronize payment dates of multiple open-endedsubscriptions, and the ability to easily start and stop service.

[0080] In order to synchronize the payments of multiple open-endedsubscriptions, order database 254 is periodically reviewed to identifymultiple subscriptions, as evidenced by order ID's having similarcustomer information. The payment frequency and next payment date of themultiple subscriptions are reviewed, and an appropriate consolidation ismade, for example, by changing the payment frequency and date formultiple subscriptions to a selected single frequency and date. Thischange is preferably done in consultation with customer 120, to makebilling and service more convenient for the customer.

[0081] Similarly, the system can readily provide other payment schedulestailored to individual customers. For example, a customer may choose tohave an expensive subscription cost billed over multiple time periods,while an inexpensive subscription cost can be billed as a single unit,or even grouped and billed with other inexpensive subscription costs.

[0082] Starts and stops, for example to accommodate extended vacations,can be supported responsive to requests from customer 120 by initiatingappropriate cancellation and subscription requests in the mannerdescribed above. Due to lead times currently required bysupplier/publisher 130 to cancel ad initiate subscriptions, such startsand stops are only practical for extended periods of stop time. However,as processes of distribution improve in efficiency, such starts andstops may be practical for decreasing stop times.

[0083] Conclusion

[0084] The system of the invention provides open-ended availability tocommodity items, such as magazines, normally available to consumers onlythrough renewable term-based subscriptions. Such open-endedsubscriptions eliminate the drawbacks associated with term-basedsubscriptions.

[0085] It will be apparent to those skilled in the art that variousmodifications and variations can be made in the system and processes ofthe present invention without departing from the spirit or scope of theinvention. Thus, it is intended that the present invention cover themodifications and variations of this invention provided they come withinthe scope of the appended claims and their equivalents. In this context,equivalents means each and every implementation for carrying out thefunctions recited in the claims, even if not explicitly describedherein.

1. A system for managing subscriptions to commodity items, comprising:means for receiving customer orders for open-ended subscriptions to saidcommodity items, said open-ended subscriptions expiring only uponrequest of respective customers; means for storing said receivedcustomer orders; means for generating supplier orders for renewable termsubscriptions to said commodity items based upon said stored customerorders; and means for transmitting said supplier orders to respectivesuppliers of said commodity items.
 2. The system of claim 1, whereinsaid customer orders include customer name, customer address, customerpayment information, and information specifying particular commodityitems for the open-ended subscriptions.
 3. The system of claim 1,wherein the means for generating supplier orders comprises: a firstdatabase storing commodity data; a second database storing supplier dataof suppliers of the commodity items; and means for correlating thecommodity data and the supplier data with the customer orders.
 4. Thesystem according to claim 1, wherein the means for receiving customerorders comprises a data terminal for allowing an operator to entercustomer order data.
 5. The system according to claim 1, wherein themeans for receiving customer orders comprises means for receivingpayment for the open-ended subscriptions.
 6. The system according toclaim 1, wherein the means for generating supplier orders comprises:means for checking billing statuses of the renewable term subscriptionsfor the commodity items; and means for transmitting payment to thosesuppliers whose corresponding billing statuses indicate that payment isdue.
 7. A method of managing subscriptions to commodity items,comprising the steps of: receiving customer orders for open-endedsubscriptions to said commodity items, said open-ended subscriptionsexpiring only upon request of respective customers; storing saidreceived customer orders; generating supplier orders for renewable termsubscriptions to said commodity items based upon said stored customerorders; and transmitting said supplier orders to respective suppliers ofsaid commodity items.
 8. The method according to claim 7, wherein saidcustomer orders include customer name, customer address, customerpayment information, and information specifying particular commodityitems for the open-ended subscriptions.
 9. The method according to claim7, wherein the step of generating supplier orders comprises the substepsof: accessing commodity data; accessing supplier data of suppliers ofthe commodity items; and correlating the commodity data and the supplierdata with the customer orders.
 10. The method according to claim 7,wherein the step of receiving customer orders comprises enteringcustomer order data into a data terminal.
 11. The method according toclaim 7, wherein the step of receiving customer orders comprises thesubstep of receiving payment for the open-ended subscriptions.
 12. Themethod according to claim 7, wherein the step of generating supplierorders comprises the substeps of: checking billing statuses of therenewable term subscriptions for the commodity items; and transmittingpayment to those suppliers whose corresponding billing statuses indicatethat payment is due.
 13. An article of manufacture for causing acomputer to manage subscriptions to commodity items, comprising: meansfor causing a computer to receive customer orders for open-endedsubscriptions to said commodity items, said open-ended subscriptionsexpiring only upon request of respective customers; means for causing acomputer to store said received customer orders; means for causing acomputer to generate supplier orders for renewable term subscriptions tosaid commodity items based upon said stored customer orders; and meansfor causing a computer to transmit said supplier orders to respectivesuppliers of said commodity items.
 14. A system for providing open-endedsubscriptions to commodity items, comprising: a first database storingcustomer orders for open-ended subscriptions to said commodity items; asecond database storing information relating to renewable termsubscriptions through which said commodity items are available fromrespective suppliers; and means for correlating said customers orders insaid first database with information stored in said second database andfor generating supplier orders for renewable term subscriptions to saidcommodity items based upon said correlation.
 15. The system according toclaim 14, further comprising means for receiving from customerscancellations of the open-ended subscriptions and means for cancelingfrom suppliers the renewable term subscriptions corresponding to thecanceled open-ended subscriptions.
 16. The system according to claim 14,further comprising: means for checking billing statuses of the renewableterm subscriptions; and means for transmitting payment to the suppliersof the commodity items for the renewable term subscriptions whosebilling status indicates that payment is due.
 17. A method of providingopen-ended subscriptions to commodity items, comprising the steps of:storing in a first database customer orders for open-ended subscriptionsto said commodity items; storing in a second database informationrelating to renewable term subscriptions through which said commodityitems are available from respective suppliers; correlating saidcustomers orders in said first database with information stored in saidsecond database; and generating supplier orders for renewable termsubscriptions to said commodity items based upon said correlation. 18.The method according to claim 17, further comprising the steps of:receiving from customers cancellations of the open-ended subscriptions;and cancelling from suppliers the renewable term subscriptionscorresponding to the canceled open-ended subscriptions.
 19. The systemaccording to claim 17, further comprising the steps of: checking billingstatuses of the renewable term subscriptions; and transmitting paymentto the suppliers of the commodity items for the renewable termsubscriptions whose billing status indicates that payment is due.
 20. Anarticle of manufacture for causing a computer to provide open-endedsubscriptions to commodity items, comprising: means for causing acomputer to store customer orders for open-ended subscriptions to saidcommodity items; means for causing a computer to store informationrelating to renewable term subscriptions through which said commodityitems are available from respective suppliers; and means for causing acomputer to correlate said customers orders in said first database withinformation stored in said second database and to generate supplierorders for renewable term subscriptions to said commodity items basedupon said correlation.
 21. A system for providing a subscription-basedcommodity item, comprising: means for storing subscription informationassociated with a plurality of subscription items available on arenewable term basis by a supplier; means for storing order informationassociated with orders for selected ones of said plurality ofsubscription items on a continuous basis; and means for correlating thesubscription information and the order information to generateappropriate renewable term subscription orders.
 22. The system of claim21 wherein fields of said subscription information include: subscriptionterm; agent cost; and subscription identifier; and wherein fields ofsaid order information include: order date, buyer cost, billing period,and billing account.
 23. The system according to claim 21, furthercomprising: means for receiving from consumers cancellations of theopen-ended subscriptions; and means for canceling from the suppliers theterm subscriptions corresponding to the canceled open-endedsubscriptions.
 24. The system according to claim 21, further comprising:means for checking a billing status of a renewable term subscription;and means for transmitting payment to a supplier for the termsubscription, when the renewable term subscription's billing statusindicates that payment is due.
 25. A method of providing asubscription-based commodity item, comprising the steps of: storingsubscription information associated with a plurality of subscriptionitems available on a renewable term basis by a supplier; storing orderinformation associated with orders for selected ones of said pluralityof subscription items on a continuous basis; and correlating thesubscription information and the order information to generateappropriate renewable term subscription orders.
 26. The method accordingto claim 25 wherein fields of said subscription information include:subscription term; agent cost; and subscription identifier; and whereinfields of said order information include: order date, buyer cost,billing period, and billing account.
 27. The method according to claim25, further comprising the steps of: receiving from consumerscancellations of the open-ended subscriptions; and canceling from thesuppliers the term subscriptions corresponding to the canceledopen-ended subscriptions.
 28. The method according to claim 25, furthercomprising the steps of: checking a billing status of a renewable termsubscription; and transmitting payment to a supplier for the termsubscription, when the renewable term subscription's billing statusindicates that payment is due.
 29. An article of manufacture for causinga computer to provide a subscription-based commodity item, comprising:means for causing a computer to store subscription informationassociated with a plurality of subscription items available on arenewable term basis by a supplier; means for causing a computer tostore order information associated with orders for selected ones of saidplurality of subscription items on a continuous basis; and means forcausing a computer to correlate the subscription information and theorder information to generate appropriate renewable term subscriptionorders.
 30. A system for offering open-ended magazine subscriptions,comprising: a first database storing subscription information associatedwith a plurality of magazines supplied by a plurality of publishers on arenewable term basis, said subscription information including anidentifier for said publisher, an identifier for said magazine, asubscription term for said magazine, and an agent cost for saidmagazine; a second database storing customer order informationassociated with customer orders for continuous subscriptions to saidmagazines, said customer order information including an identifier forsaid customer, an identifier for said magazine, an order date, a billingperiod, a customer cost, and a billing account; and means forcorrelating said subscription information stored in said first databasewith said customer order information stored in said second database andfor generating supplier orders for renewable term subscriptions to saidmagazines based upon said correlation.
 31. The system according to claim30, further comprising: means for receiving from consumers cancellationsof the open-ended subscriptions; and means for canceling from thesuppliers the term subscriptions corresponding to the canceledopen-ended subscriptions.
 32. The system according to claim 30, furthercomprising: means for checking a billing status of a renewable termsubscription; and means for transmitting payment to a supplier for theterm subscription, when the renewable term subscription's billing statusindicates that payment is due.
 33. The system according to claim 30,further comprising means for requesting suppression of renewal noticesfor a magazine subscription from a publisher to a customer.
 34. A methodof offering open-ended magazine subscriptions, comprising: storing in afirst database subscription information associated with a plurality ofmagazines supplied by a plurality of publishers on a renewable termbasis, said subscription information including an identifier for saidpublisher, an identifier for said magazine, a subscription term for saidmagazine, and an agent cost for said magazine; storing in a seconddatabase customer order information associated with customer orders forcontinuous subscriptions to said magazines, said customer orderinformation including an identifier for said customer, an identifier forsaid magazine, an order date, a billing period, a customer cost, and abilling account; and correlating said subscription information stored insaid first database with said customer order information stored in saidsecond database; and generating supplier orders for renewable termsubscriptions to said magazines based upon said correlation.
 35. Themethod according to claim 34, further comprising the steps of: receivingfrom consumers cancellations of the open-ended subscriptions; andcanceling from the suppliers the term subscriptions corresponding to thecanceled open-ended subscriptions.
 36. The method according to claim 34,further comprising: checking a billing status of a renewable termsubscription; and transmitting payment to a supplier for the termsubscription, when the renewable term subscription's billing statusindicates that payment is due.
 37. The system according to claim 34,further comprising the step of requesting suppression of renewal noticesfor a magazine subscription from a as publisher to a customer.
 38. Asystem for offering open-ended magazine subscriptions, comprising: meansfor receiving a subscription order from a customer for the purchase ofat least one open-ended magazine subscription; means for creating anorder record based upon the subscription order and storing the orderrecord in an order database; mean for calculating a first payment amountfrom the order record; and means for transmitting the calculated firstpayment amount to a payment clearinghouse.
 39. The system according toclaim 38, wherein the means for receiving a subscription order comprisesa data terminal for allowing an operator to enter data relating to thesubscription order.
 40. The system according to claim 38, furthercomprising means for creating a subscription record corresponding to theorder record to initiate a renewable term subscription from a magazinesupplier.
 41. A method of offering open-ended magazine subscriptions,comprising the steps of: receiving a subscription order from a customerfor the purchase of at least one open-ended magazine subscription;creating an order record based upon the subscription order and storingthe order record in an order database; calculating a first paymentamount from the order record; and transmitting the calculated firstpayment amount to a payment clearinghouse.
 42. The method according toclaim 41, wherein the step of receiving a subscription order comprisesthe substep of entering data relating to the subscription order into adata terminal.
 43. The method according to claim 41, further comprisingthe step of creating a subscription record corresponding to the orderrecord to initiate a renewable term subscription from a magazinesupplier.
 44. A system for ordering magazines through open-endedmagazine subscriptions, comprising: a first database storingsubscription information relating to a plurality of renewable termsubscriptions for magazines from respective publishers; a seconddatabase storing order information relating to customer orders forselected ones of said magazines on an open-ended basis; a third databasestoring publisher information relating to each of said plurality ofpublishers; and means for selecting information from said first, second,and third databases to create subscription orders for initiatingrenewable term magazine subscriptions from respective publishers torespective customers.
 45. The system according to claim 44, furthercomprising means for transmitting said subscription records to saidpublisher to initiate respective magazine subscriptions.
 46. The systemaccording to claim 45, further comprising means for transmitting paymentto said publisher for said magazine subscriptions.
 47. The systemaccording to claim 45, further comprising means for billing said buyerfor said subscription.
 48. The system according to claim 44, wherein thepublisher information includes, for each publisher, a publishersubscription data format, and wherein the means for selecting comprisesmeans for creating a subscription record in the respective publishersubscription data format.
 49. A method of ordering magazines throughopen-ended magazine subscriptions, comprising the steps of: storing in afirst database subscription information relating to a plurality ofrenewable term subscriptions for magazines from respective publishers;storing in a second database order information relating to customerorders for selected ones of said magazines on an open-ended basis;storing in a third database publisher information relating to each ofsaid plurality of publishers; and selecting information from said first,second, and third databases to create subscription orders for initiatingrenewable term magazine subscriptions from respective publishers torespective customers.
 50. The method according to claim 49, furthercomprising the step of transmitting said subscription records to saidpublisher to initiate respective magazine subscriptions.
 51. The methodaccording to claim 50, further comprising the step of transmittingpayment to said publisher for said magazine subscriptions.
 52. Themethod according to claim 50, further comprising the step of billingsaid buyer for said subscription.
 53. The method according to claim 49,wherein the publisher information includes, for each publisher, apublisher subscription data format, and wherein the step of selectingcomprises the substep of creating a subscription record in therespective publisher subscription data format.
 54. A system forproviding open-ended magazine subscriptions, comprising: a firstdatabase storing subscription information relating to a renewable termsubscription to a magazine offered by a magazine publisher, saidrenewable term subscription including a subscription term; a seconddatabase storing order information relating to a customer order for anopen-ended subscription to said magazine; means for periodicallychecking a billing status of said renewable term subscription; and meansfor submitting payment for said renewable term subscription when saidbilling status indicates that said term subscription requires renewal.55. The system according to claim 54, further including means,responsive to said subscription term status check, for initiatingrenewals of said renewable term subscriptions when said subscriptionterms have expired.
 56. The system according to claim 55, furtherincluding means for transmitting payment for said subscription renewals.57. A method of providing open-ended magazine subscriptions, comprisingthe steps of: storing in a first database subscription informationrelating to a renewable term subscription to a magazine offered by amagazine publisher; storing in a second database order informationrelating to a customer order for an open-ended subscription to saidmagazine, said order information including a billing period;periodically checking a billing status of said renewable termsubscription; and submitting payment for said renewable termsubscription when said billing status indicates that said termsubscription requires renewal.
 58. The method according to claim 57,further including the step of initiating, responsive to saidsubscription term status check, renewals of said renewable termsubscriptions when said subscription terms have expired.
 59. The methodaccording to claim 58, further including the step of transmittingpayment for said subscription renewals.
 60. A system for providingopen-ended magazine subscriptions, comprising: a first database storingsubscription information relating to renewable term subscriptions tomagazines offered by magazine publishers; a second database storingorder information relating to customer orders for open-endedsubscriptions to respective magazines, said order information includinga billing period for each open-ended subscription; and means forgenerating and transmitting invoices for said open-ended subscriptionsto respective customers for respective billing periods.
 61. The systemaccording to claim 60, wherein the means for generating a comprisesmeans for identifying every open-ended subscription for a customer andfor synchronizing the billing periods of the identified open-endedsubscriptions.
 62. The system according to claim 61, wherein the meansfor generating further comprises means for transmitting a single invoiceto each customer.
 63. A method of providing open-ended magazinesubscriptions, comprising: storing in a first database subscriptioninformation relating to renewable term subscriptions to magazinesoffered by magazine publishers; storing in a second database orderinformation relating to customer orders for open-ended subscriptions torespective magazines, said order information including a billing periodfor each open-ended subscription; and generating and transmittinginvoices for said open-ended subscriptions to respective customers forrespective billing periods.
 64. The method according to claim 63,wherein the step of generating comprises the substeps of identifyingevery open-ended subscription for a customer and synchronizing thebilling periods of the identified open-ended subscriptions.
 65. Themethod according to claim 64, wherein the step of generating furthercomprises the substep of transmitting a single invoice for eachcustomer.
 66. A system for providing open-ended subscriptions tomagazines, comprising: means for accessing information about a renewableterm subscription to a magazine; means for storing magazine andpublisher information related to said magazine; means for receiving acustomer order requesting conversion of the renewable term subscriptionto an open-ended subscription from an agent; means for generating anorder record containing information for the open-ended subscription;means for generating a renewable term subscription order containinginstructions suppressing mailing of renewable notices to the customer;and means for transmitting the renewable term subscription order to themagazine publisher.
 67. The system according to claim 66, wherein themeans for generating the renewable term subscription order comprisesmeans for generating a renewable term subscription order indicating thatthe agent is responsible for payment for the renewable termsubscription.
 68. The system according to claim 66, wherein the meansfor generating an order record comprises means for extracting customerinformation from the accessed information about the renewable termsubscription.
 69. The system according to claim 68, wherein the meansfor generating an order record further comprises means for extractinginformation from the stored magazine and publisher information.
 70. Amethod of providing open-ended subscriptions to magazines, comprising,the steps of: accessing information about a renewable term subscriptionto a magazine; storing magazine and publisher information related tosaid magazine; receiving a customer order requesting conversion of therenewable term subscription to an open-ended subscription from an agent;generating an order record containing information for the open-endedsubscription; generating a renewable term subscription order containinginstructions suppressing mailing of renewable notices to the customer;and transmitting the renewable term subscription order to the magazinepublisher.
 71. The method according to claim 70, wherein the step ofgenerating the renewable term subscription order comprises the substepof generating a renewable term subscription order indicating that theagent is responsible for payment for the renewable term subscription.72. The method according to claim 70, wherein the step of generating anorder record comprises the substep of extracting customer informationfrom the accessed information about the renewable term subscription. 73.The method according to claim 72, wherein the step of generating anorder record further comprises the substep of extracting informationfrom the stored magazine and publisher information.